Letter to the Editor: The facts about Trickle Down Economics

To the Editor:

Thomas Hill has it wrong once again. He has distorted some facts and ignored others to try to prove his point that only a few Americans are benefiting from the Trump Tax Bill in his letter October 24.

Mr.  Hill claims that only a few people are actually seeing any benefits and suggests that the tax reduction for corporations has resulted in windfall profits for those corporations. He fails to understand that the tax cuts allowed those corporations to repatriate almost three trillion dollars at a lower tax rate that had been sitting in offshore accounts. The money they have repatriated has been used to buy back stock in some instances.

What Mr. Hill does not recognize is that the buybacks have resulted in increased dividends for stockholders of those corporations. He apparently does not know that 55 million households have 401k stock plans and recent data shows that those 401ks have increased in value by about 30% since the reduction in taxes. Microsoft recently paid out $1.6 billion to its stock holders. That looks like more than crumbs to me. The stockholders are not all millionaires. They are people who are trying to form for themselves a better retirement.

Mr. Hill complains about the increase in the 2018 budget deficit by $779 billion.  He does not acknowledge that most of that increase is due to the goofy omnibus bill that was passed this year that included huge spending increases demanded by Democrats. Did he complain about the huge deficit, more than all other presidents combined, that Obama foisted on the country?

The corporation tax rate was cut to make American corporate tax rates more competitive with corporate tax rates in other countries. Can he not see how many companies have returned to operate in the U.S. because of this? Companies have come back that Obama said could never come back, even with the wave of a magic wand. Many U.S. businesses have moved to places like Ireland where the corporate tax rate is only 13%. They were paying over 30% here. Do you want jobs here or in Ireland and other countries?

The Republicans have been trying for years to get the Democrats to cooperate in finding a solution to the Social Security and Medicare problems. The Democrats have refused and would rather have the problem as an issue.

Everyone needs to remember that it was LBJ - a Democrat - who raided the Social Security Trust Fund and decided that all Social Security revenues should be a part of the general fund.

Increased entitlements beyond Social Security and Medicare are causing fiscal problems. Mr. Hill should look closely at what percent of the budget is now taken up by those programs. And he might take a close look at how much illegal immigrants take out of those funds.

Some government agencies’ budgets need to be cut.  I worked in the government for many years and I know the waste that is there. I applaud any effort to cut back operating expenses.

President Trump made a smart move in reducing all taxes. When he makes the next cut, aimed specifically at the middle class, we will see even more growth for the economy and in wealth for everyone.

Lowell Engle
Harpers Ferry